Clusters enable economic actors to develop collective knowledge, as well as work together to overcome challenges and seize potential new economic opportunities. The development of agricultural clusters is a recent phenomenon in Algeria. The subject of evaluation studies since the 1980s, the National Territory Planning Scheme 2025 (Schéma National d’Aménagement du Territoire, SNAT 2025), which was drafted in 2006, is focused on such zones. The SNAT 2025 is an attempt by the government to boost six poles of competitiveness and excellence (pôles de compétitivité et d’excellence, PCEs), which include the agricultural sector.
Poles Of Competitiveness
As part of the SNAT 2025, the Ministry of Agriculture, Rural Development and Fisheries (Ministère de l’Agriculture, du Dé veloppement Rural et de la Pêche, MADRP) plans to create six PCEs in major cities and rural areas aimed at supporting agro-industrial research and innovation, reducing unemployment and under-employment, and maximising the potential of the local farming land. The MADRP has planned for the development of PCEs in biotechnology and agro-industry in areas around Algiers and Constantine, and for a Saharan agriculture cluster along the Ouargla-Hassi Messaoud-Ghardaïa axis. The strategy also includes plans for a cluster for organic farming in Algiers, Blida and Tipaza-Boumerdès-Tizi Ouzou; an olive oil cluster in Bouira-Béjaïa-Skikda; a PCE for cereals and dried vegetables in Constantine-Sétif-Tiaret; a sheep and goats PCE in Djelfa-Laghouat-El Bayadh-Naama; a palm cultivation zone in Oued-Biskra-Tolga-Ouargla; and an aquaculture cluster in El Tarf-Annaba. Under a technical assistance contract with the World Bank, the MADRP is also working on a milk cluster in Souk Ahras.
Private Sector Challenges
Though the SNAT 2025 has enabled the creation of such clusters, the UN’s Industrial Development Organisation has highlighted their slower development due to a lack of private sector investment. Indeed, the government and public institutions were the larger driving forces behind these initiatives. Given the impact of lower oil prices on the government’s budgets since 2015, the MADRP has recognised the need for increased private sector investment in the agricultural sector. During a conference on agricultural development in Constantine in May 2016, Sid Ahmed Ferroukhi, the then-minister of agriculture, rural development and fisheries, called on private actors to invest in agricultural clusters and contribute to the development of specialised PCEs in each province. Additionally, the then-minister recognised the key role private sector investors can play in advancing scientific research and mechanisation in each zone.
Cluster Development
In May 2016 Ferroukhi also stated that the ministry had identified more than 100 agricultural clusters in 600 towns in Algeria so far. That same month, three additional clusters were created in the Khenchela province, in the north-east of the country. According to the Agricultural Services Directorate, which is under the MADRP, one cluster specialises in cereals, one in milk and the last in fruit trees. The cereals cluster spans some 25,000 ha of irrigated land and is expected to yield 700,000 quintals of wheat during the 2016 harvest. The fruit trees cluster, which covers an area of 3186 ha, is focused on apples and is expected to yield 735,000 quintals during the 2016 harvest. Lastly, the milk cluster will be spread across the towns of Remila, El Hamma, Baghai and El Mahmel, with a total of 8600 milk cows and an average production of 27m litres of milk, of which 17m litres is to be processed in four local creameries.
Though the government and the MADRP have been pushing for the creation of more agricultural clusters and PCEs, the process has been slow, primarily due to weak private sector investment. Beyond the call for more investment, concrete measures to improve the business climate and attract private investors are needed. Doing so will allow Algeria’s agricultural sector to mechanise further and evolve based on the latest agro-industrial scientific technologies and research.
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